Even if you’ve been in the inventory management field for some time, there are a number of facts out there that may surprise you. More importantly, some of these surprising statistics can (and should) be leveraged to improve how your inventory process is handled. Let’s take a look at 5 inventory management stats that you probably didn’t know about.
~ An estimated $1.1 trillion of capital is tied up in inventory (along with accounts payable and receivable). Even if just a tiny fraction of this is accredited to your business, you could be sitting on money that could be much better used elsewhere.
~ Almost half of all small to mid-sized businesses in the US either use a manual method to track inventory, or don’t bother tracking it at all. That means that almost 1 out of every 2 businesses are not properly managing their inventory. If you are, you’re already a step ahead of the competition.
~ Despite the fact that manufacturing and shipping are both becoming much more efficient, businesses are still holding on to inventory more than they probably should. In fact, the amount of inventory on hand based on sales per day, also known as “days inventory outstanding,” has gone up by 8.3% over the past five years.
~ Inventory management does more than just save businesses money. It also dramatically reduces costly errors which, in some industries, can actually save lives. One academic medical center credited the use of barcodes on medication with a reduction in administration errors of over 41%.
~ Over the past five years, the number of warehouses in the US has increased by 6.8%. That means that competition is continuing to rise.
What do all of these statistics mean? Well, for one, it’s clear that inventory and warehousing aren’t